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TMI Blog2016 (8) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... 08.05.2015, in which, he held that the assessee was entitled to refund of tax of Rs. 2,01,39,826/- which, alongwith interest of Rs. 39,27,266/- came to a total of Rs. 2,40,67,092/-. In short, under this order of assessment, the Assessing Authority held that the petitioner is entitled to total refund of a sum of Rs. 2,40,67,092/- inclusive of interest. Despite this order, the VAT authorities did not release such refund. The petitioner, therefore, after making representations to the authorities and having failed to get a positive response, filed Special Civil Application No. 7176 of 2016, in which, the only prayer made is for direction to grant refund of the said sum of Rs. 2,40,67,092/- with interest for the delayed period. 3. After this p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nance the approach of the authority. The authority has filed two replies to justify withholding of the refund. In first such affidavit dated 23.06.2016, it is stated inter alia that: "9. I say and submit that though the assessment gave rise to a refund of Rs. 2.4 crore the refund payment order has yet not been passed by the authorities for payment of refund. Prior to issuing the RPO (Refund Payment Order) the authorities hereby were incumbent to duly scrutinize every transaction of the petitioner very minutely. The said scrutiny was to be conducted by Assistant Commissioner Flying Squad, Unit-6 (Annexure-2). In light of the departmental instruction dated 03.12.2015, Assistant Commissioner Flying Squad, Unit-6 initiated steps to scrutinize ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion and scrutiny the petitioner approach this Hon'ble High Court for grant of refund which has arisen due to the assessment order dated 08.05.2015. I say and submit that it would be necessary for the Hon'ble Court to consider that the authorities herein has issued notice dated 08.06.2016 calling upon the petitioner for producing necessary records prior to initiating the proceedings u/s. 75 of the Gujarat Value Added Tax Act, 2003 meaning thereby the authorities have given a notice (Annexure-6) calling for the record which is prior to initiating the proceedings u/s. 75 of the Gujarat Value Added Tax Act, 2003 being suo motu revision for revising the asessment order dated 08.05.2015 giving rise to refund to the tune of Rs. 2.4 crore. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where the purchase in form No. 4870199 (C form submitted by M/s. Heli infotec) to the authorities of Gujarat is Rs. 3,72,27,866/- (Annexure R 5 Copy of Form C submitted with department) From the above report it is clear that the petitioner's claim of having made sales to the tune of Rs. 3.72 crores is questionable and requires further verification." 7. The gist of the two affidavits, thus, is that as per the respondents, mere passing of the order of assessment resulting into refund, would not be sufficient for the assessee to claim such refund and a separate order of refund has to be passed. Further, the Joint Commissioner of Commercial Tax has already issued notice for production of documents to ascertain whether the order of assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d proper within five years from the date of the order in question. Thus, the Commissioner has full period of three years from the date of the order to take the same into suo motu revision. Surely, the department cannot withhold the refund arising out an order of assessment for such full period of three years without any reason. The period of limitation for taking an order in revision cannot be related to the right of the assessee to seek refund arising out of an order of assessment. Such right can be curtailed in terms of Section 39 of the VAT Act which pertains to power to withhold the refund in certain cases and reads as under: "39. Power to withhold refund in certain cases. (1) Where an order giving rise to a refund is the subject mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order is passed, the refund cannot be automatically withheld. It may be that once the order of assessment is passed, the assessee may have to wait for a reasonable period before he can seek implementation of order of assessment and grant of refund. However, beyond a reasonable period if such refund is to be withheld, the Commissioner must exercise powers under sub section (1) of Section 39, only upon which, his discretion would be properly regulated. Sub section (1) of Section 39, we may recall, envisages grant of hearing to the dealer before any order of withholding of refund is passed. In the present case, no such order has been passed. 11. Coming to the facts of the case, we have noticed that the petitioner's claim of Rs. 2,40,67,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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